Navy Supply:

Some Aircraft and Ship Parts Should Be Replaced Rather Than Repaired

NSIAD-92-40: Published: Dec 2, 1991. Publicly Released: Dec 2, 1991.

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Pursuant to a congressional request, GAO reviewed the Navy's management of repairable aircraft and ship components, focusing on whether: (1) unnecessary repairs were being made; and (2) repair data were accurate.

GAO found that: (1) the Navy spends millions of dollars annually to repair assets that have no known wartime or peacetime requirements, mainly because of inadequate procedures for identifying excess assets in the repair program; (2) the Navy prevents unnecessary repairs and reduces the need for funds to pay for repair costs, when it uses serviceable ready-for-issue assets in lieu of repair; (3) the Navy made unnecessary repairs, since Navy procedures for identifying long supply assets in the repair program underestimated the number of items actually in long supply; (4) between April and September 1990, Navy repair activities made 7,710 repairs costing $9.2 million for items that were excess to current needs; (5) contrary to Navy policy, it was repairing many items that it could have more economically replaced, and an analysis of 25 randomly selected items indicated that it would have been more economical to replace 18 of the items; and (6) records on repair survival rates and repair turnaround times were not accurate and tended to overstate the repair requirements, which ultimately led to the accumulation of excess stocks.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: The Department of Defense (DOD) stated that accurate initial requirements, determinations, and timely revisions are key to an effective repair program and that it has adequate procedures. GAO still believes that the Navy does not have effective controls in place to prevent the repair of items that fall into a long supply status after the initial requirements determination.

    Recommendation: The Secretary of the Navy should direct the Commander, Naval Supply Systems Command, to implement procedures that give better consideration to items that become long supply in managing its repair programs.

    Agency Affected: Department of Defense: Department of the Navy

  2. Status: Closed - Not Implemented

    Comments: DOD agreed that long supply assets should be considered in the repair program but did not agree that the actions GAO recommends are necessary. DOD stated that appropriate procedures are already in place. GAO findings indicate that the Navy does not have effective controls in place to prevent the repair of items that fall into a long supply status after the initial requirements determination.

    Recommendation: To comply with Navy policy not to repair items in long supply, the Commander, Naval Supply Systems Command, should direct the Ships Parts Control Center to develop a long supply indicator that is consistent with the Navy definition of long supply and use the resultant indicator in repairable management.

    Agency Affected: Department of Defense: Department of the Navy: Naval Supply Systems Command

  3. Status: Closed - Not Implemented

    Comments: DOD agreed that long supply assets should be considered in the repair program but did not agree that the actions GAO recommends are necessary. DOD stated that appropriate procedures are already in place. GAO findings indicate that the Navy does not have effective controls in place to prevent the repair of items that fall into a long supply status after the initial requirements determination.

    Recommendation: To comply with Navy policy not to repair items in long supply, the Commander, Naval Supply Systems Command, should provide all repair activities, including commercial and other military service activities, with information that indicates when ready-for-issue assets already exist in long supply and therefore, should not be repaired.

    Agency Affected: Department of Defense: Department of the Navy: Naval Supply Systems Command

  4. Status: Closed - Not Implemented

    Comments: DOD agreed that long supply assets should be considered in the repair program but did not agree that the actions GAO recommends are necessary. DOD stated that appropriate procedures are already in place. GAO findings indicate that the Navy does not have effective controls in place to prevent the repair of items that fall into a long supply status after the initial requirements determination.

    Recommendation: To comply with Navy policy not to repair items in long supply, the Commander, Naval Supply Systems Command, should direct ASO to use a long supply indicator in repairable management programs that is consistent with the Navy definition of long supply.

    Agency Affected: Department of Defense: Department of the Navy: Naval Supply Systems Command

  5. Status: Closed - Not Implemented

    Comments: Although DOD agreed that emphasis should be placed on economy of repair reviews and that current pricing data should be used, it did not agree that the actions GAO recommends are necessary. DOD stated that appropriate procedures are already in place. GAO disagrees and still believes that a repair-versus-replacement analysis is needed if there are indications that replacement would be less costly.

    Recommendation: The Secretary of the Navy should direct the Commander, Naval Supply Systems Command, to increase emphasis on economy-of-repair reviews by ensuring that all items are reviewed if there are indications that replacement is less costly than repair, including those procured by other services and those that have not been purchased recently.

    Agency Affected: Department of Defense: Department of the Navy

  6. Status: Closed - Not Implemented

    Comments: Although DOD agreed that emphasis should be placed on economy of repair reviews and that current pricing data should be used, it did not agree that the actions GAO recommends are necessary. DOD stated that appropriate procedures are already in place. GAO disagrees and still believes that a repair-versus-replacement analysis is needed if there are indications that replacement would be less costly.

    Recommendation: The Secretary of the Navy should direct the Commander, Naval Supply Systems Command, to increase emphasis on economy-of-repair reviews by ensuring that current pricing data is used to make repair versus buy decisions.

    Agency Affected: Department of Defense: Department of the Navy

  7. Status: Closed - Not Implemented

    Comments: DOD agreed that the data used to manage the repair programs should be accurate but contends that appropriate procedures are already in place to achieve this result. Although procedures exist to ensure accurate data, GAO found that they are not adequate. GAO's review identified many inaccuracies in the data; therefore, improved procedures are still needed.

    Recommendation: The Secretary of the Navy should direct the Commander, Naval Supply Systems Command, to implement procedures to ensure the accuracy of data used to manage repair programs. Specifically, the Commander should routinely isolate data that deviates from acceptable standards, review the data for accuracy, and revise inaccurate data.

    Agency Affected: Department of Defense: Department of the Navy

 

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